WHEN CONSUMERS READ HOW COMPANY HANDLES CUSTOMER COMPLAINTS ONLINE: THE INTERPLAY OF RETAILER RESPONSE AND AUDIENCE POWER
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In the era of digital retailing, consumer-empowering technologies greatly facilitate the dissemination of complaint messages. Consumer audiences, who view consumer complaints and the subsequent responses made by retailers, consider these messages as critical information sources for decision-making (Weitzl & Hutzinger, 2017). We argue that retailers can use two types of response strategies (warmth- vs. competence-related response) to regulate the information distributed online, and that these strategies may influence consumer audiences’ perceptions and subsequent attitudes and behaviors differently based on their different levels of power (Rucker, Galinsky, & Dubois, 2012). Two experimental studies using a 2 (retailer response: warmth vs. competence) X 2 (audience power: low vs. high) between-subjects design were conducted. Study 1 (N = 240) revealed an interactive effect of power and retailer response on perceived diagnosticity and perceived fairness; and Study 2 (N = 233) showed that the significant moderated mediation for audiences’ perceptions on the relationship between retailer response X audience power and outcome variables. Theoretically, this study enriches the consumer complaint management literature from the perspective of consumer audience. It also sheds light on the power theory by validating its notion in the context of service failure and recovery. Practically, results demonstrate how retailers can effectively respond to negative consumer reviews to maintain customer relationship management with consumer audiences in digital age.